Gold's explosive rally past $4,000 an ounce in 2025 may look like a safe-haven triumph — but NYU finance professor Aswath Damodaran says investors should take a closer look before betting on the yellow metal.

In a new blog post, Damodaran argues that gold is “decidedly overpriced” based on its historical relationships with inflation, equity risk premiums, and real interest rates. Despite its 57% surge this year — and a decade-long climb from $1,060 to over $4,000 an ounce — he suggests the precious metal's fundamentals don’t support the hype. Advertisement

“Gold is often touted as a hedge against inflation and crises, but the evidence from history is nuanced,” Damodaran wrote. He noted that gold, unlike stocks or bonds, produces no cash flows, making it less a financial asset and more a

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